One-glance verdict
Within fair range
$241.17 our estimate vs market $354.53
47% above our estimate
Fundamentals snapshot
TopBuild Corp.
BLD · NYQ · Industrials · Engineering & Construction
Current price
$354.53
52-week range
$330.51 - $559.47
Market cap
$9.94B
Balance sheet
Stretched
7.63x Adequate
Net debt $2.86B. Interest coverage shows how many times profit covers the interest bill.
What stands out
3 Rewards
3 Risks
3 rewards · 3 risks
- Reward Revenue grew 3.9% last year.
- Reward Returns 22.3% on equity, ahead of 50% of its peers.
- Risk Net debt grew 106.4% over 3 years.
- Risk Stock trades 19.5% above its 5-year average P/E.
What this company does
TopBuild Corp.
TopBuild sells and installs insulation and other essential building materials like gutters and roofing for homes and commercial properties. The company makes money from two main activities: sending its crews to perform installations and distributing (selling in bulk) these materials to other contractors. Because its business depends heavily on new construction and renovation projects, its financial health is often connected to the overall housing market.
How the company got here
TopBuild was originally part of a larger company, Masco Corporation, focusing on installing insulation. In 2015, it was spun off to become its own independent, publicly traded company. This move allowed TopBuild to focus entirely on its specialty: insulation and other building products. Since then, a key part of its strategy has been to grow by acquiring smaller, local companies to expand its reach and product offerings across the United States and Canada.
What it actually does
Think of TopBuild as a company that helps make new and existing buildings more comfortable and energy-efficient. They are primarily involved in insulation, the material in your walls and attic that keeps your house warm in the winter and cool in the summer. Besides insulation, they also work with other building materials you might recognize, like gutters, garage doors, fireplaces, and windows. They serve a wide range of customers, from large homebuilders constructing new neighborhoods to individual homeowners doing renovations.
Installation
This is the larger part of TopBuild's business, making up more than half of its sales. In this segment, the company's workers physically go to construction sites to install insulation and other products like roofing, gutters, and garage doors. Their customers are typically homebuilders, commercial contractors, and homeowners who pay for the service of having these materials professionally installed. This part of the business operates through well-known brands like TruTeam and Progressive Roofing.
Specialty Distribution
This segment acts like a wholesale supplier for the construction industry. Instead of installing products themselves, they sell insulation and other building materials directly to smaller contractors and builders who then do the installation. This part of the business operates through a network of over 250 distribution centers under brands like Service Partners. This business is a significant, but smaller, portion of the company's overall revenue.
What management is betting on now
TopBuild's main strategy is to continue growing by acquiring other companies in the fragmented building materials market. They are also focused on expanding their product offerings beyond just insulation to sell more to their existing customers. Another priority is to increase their business with commercial construction (like office buildings and warehouses) to be less dependent on the cycles of the new home construction market. By improving the operations of the companies they acquire, they aim to increase their margins (the profit they make on each sale).
Price history
How the share price has moved
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Earnings history
Last 8 quarters — what happened
Click any quarter to read the call summary and what the numbers say.
FY2024 Q2
$74.26M
FY2024 Q3
$219.85M
FY2024 Q4
$253.67M
FY2025 Q1
$139.19M
FY2025 Q2
$182.17M
FY2025 Q3
$216.16M
FY2025 Q4
$159.36M
FY2026 Q1
$146.74M
Revenue
$1.45B
Net income
$104.81M
Diluted EPS
3.73
Operating cash flow
$160.74M
Free cash flow
$146.74M
Fetching…
Sources
Revenue
$1.49B
Net income
$104.51M
Diluted EPS
3.69
Operating cash flow
$176.73M
Free cash flow
$159.36M
Fetching…
Sources
Revenue
$1.39B
Net income
$142.23M
Diluted EPS
5.04
Operating cash flow
$233.31M
Free cash flow
$216.16M
Fetching…
Sources
Revenue
$1.30B
Net income
$151.60M
Diluted EPS
5.32
Operating cash flow
$193.69M
Free cash flow
$182.17M
Fetching…
Sources
Revenue
$1.23B
Net income
$123.39M
Diluted EPS
4.23
Operating cash flow
$152.59M
Free cash flow
$139.19M
Fetching…
Sources
Revenue
$1.31B
Net income
$150.54M
Diluted EPS
5.07
Operating cash flow
$266.23M
Free cash flow
$253.67M
Fetching…
Sources
Revenue
$1.37B
Net income
$168.96M
Diluted EPS
5.65
Operating cash flow
$240.67M
Free cash flow
$219.85M
Fetching…
Sources
Revenue
$1.37B
Net income
$150.72M
Diluted EPS
4.78
Operating cash flow
$90.35M
Free cash flow
$74.26M
Fetching…
Sources
Is it cheap or expensive?
Fair value $241.17 vs current price $354.53
Our most-likely fair value is $241.17 a share — about 32.0% away from today's price of $354.53, so the stock currently looks fairly priced.
Is it drowning in debt?
Stretched
Net debt $2.9B. Interest coverage 7.6x.
Net debt
$2.86B
Interest coverage
7.63x
TopBuild Corp.'s profit covers its interest bill about 7.6 times over. which is stronger than most peers shown here and 1 peers sit below 1x, which is the danger zone where profit does not fully cover the interest bill.
Stretched
Worse cushion
Baseline
Better cushion
BLD
BASELINE
TopBuild Corp.
Total debt $3.13B Interest coverage 7.63x This is the baseline the peer rows are being compared against.
Total debt $1.18B Interest coverage 12.19x +60% vs BLD Carries about 1.6x more debt cushion than BLD.
Total debt $5.29B Interest coverage 2.87x -62% vs BLD Carries about 2.7x less debt cushion than BLD.
Total debt $6.02B Interest coverage 6.11x -20% vs BLD Carries about 1.2x less debt cushion than BLD.
Total debt $3.35B Interest coverage 5.75x -25% vs BLD Carries about 1.3x less debt cushion than BLD.
Total debt $1.07B Interest coverage -6.40x -100% vs BLD This peer has almost no interest-payment cushion compared with BLD.
What you should know
The case for and against BLD
3 Rewards
3 Risks
Rewards
-
Revenue grew 3.9% last year.
-
Returns 22.3% on equity, ahead of 50% of its peers.
-
Free cash flow was positive in 10/10 years.
Risks
-
Net debt grew 106.4% over 3 years.
-
Stock trades 19.5% above its 5-year average P/E.
-
Operating margin compressed from 15.9% to 12.2% over 3 years.
The numbers
All the key metrics, grouped by purpose
Tap any ? icon to learn what it means.
Valuation
How expensive the stock looks
P/E (TTM)
19.92x
Forward P/E
17.04x
P/B
4.13x
P/S
1.77x
EV/EBITDA
12.54x
PEG ratio
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Profitability
How much profit each dollar creates
Gross margin
29.0%
Operating margin
12.2%
Net margin
8.9%
ROE
22.3%
ROA
9.2%
Health
Liquidity and balance-sheet strength
Debt / equity
1.30x
Current ratio
2.00x
Quick ratio
1.36x
Total debt
$3.13B
Total cash
$268.85M
Growth
How the business has been compounding
Revenue TTM
$5.62B
Revenue 5Y CAGR
11.6%
EPS TTM
17.80
EPS 5Y CAGR
2.2%
Cash flow
How much cash the business throws off
Operating CF TTM
$764.47M
Free CF TTM
$696.89M
FCF margin
12.4%
Dividend
Shareholder payout
Yield
—
Payout ratio
0.0%
Last ex-div date
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